S&P lowers Movie Gallery's credit rating

Standard & Poor's Ratings Services today lowered its corporate credit rating on Dothan-based Movie Gallery Inc., which has struggled with $1 billion in debt tied to an acquisition that made it the nation's second-largest video chain.

The rating was lowered to D, signifying default, from CC, meaning the company is considered vulnerable to nonpayment.

Movie Gallery has said it has missed interest payments on some of its obligations and that it has worked out agreements with lenders and bondholders to not take action until Sept. 30.